Put it on My Tab! Square Makes Purchases Zipless

In the very near future, I’ll be able to walk into the grocery store, have the cashier ring up a box of Graham Oh’s, say, “Oh, hi, I’m Tim Fernholz,” and walk away without handing over cash or cards. Nope, it’s not shoplifting—it’s Card Case, an innovative new app that aims to change the way we shop.

Card Case is the latest product from Square, the company co-founded by Twitter founder Jack Dorsey to revolutionize the way we pay. Square’s eponymous product is a card reader that plugs into your phone and allows you to process credit and debit card payments straight from your bank account, minus a 2.5 percent commission for the middle man.

This, then, is the next front in Dorsey’s payments war. You install Card Case as an app on your smartphone, and whenever you find yourself within 100 feet of a store or restaurant where you want to make a purchase, you open a virtual “tab” on your phone (or you can set the app to open them automatically).

When you get to the register, tell the cashier your name, and her register (maybe just a tablet computer) will detect your phone, display your picture so she knows you’re the right person to charge, and deduct the cost of your item straight from your bank account. Then you’re out.

It’s not just about ease of use, though. The app can integrate restaurant menus and social media, not to mention specific discounts—it could be a Groupon killer—while tracking your spending and receipts. Its location functionality can let you know what stores are nearby. Retailers, in turn, can detect when you’re on their premises and know what you’ve gotten before, so you’ll be recognized like a regular—if you are a regular, perhaps you'll receive a special discount—and the barista will know that you like a skim vanilla latte.

Unlike Google Wallet, the pay-by-phone app created by the search giant, this app works on any iOs or Droid device, and it doesn’t require additional wireless network hardware to scan the phone, making it easier for both customers and merchants to adopt. It's also compatible with the Square card reader. Very few merchants use Card Case now, but Square is betting that its ease of adoption and marketing functionality will allow their system to scale up very quickly.

This is something special; Slate’s Farhad Manjoo says the experience “feels magical,” and it’s hard to disagree. By cleverly adapting today’s technology—GPS smartphones, online payment processing and data as a retail business tool—Square has come up with a potentially disruptive product.